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Unlikely Person at the Heart of India’s Scandal

NEW DELHI — He was a small-town lawyer from a regional political party in a southern Indian state. By almost any measure, Andimuthu Raja, who had no background in telecommunications or in business, seemed an unlikely candidate to be the government minister presiding over the fastest-growing cellphone market in the world.

But he had the only qualification that mattered: the ironclad backing of the political chieftain of his party, a crucial ally of the governing Congress Party. Without his party’s 16 members of the lower house of Parliament, the government cobbled together from squabbling allies would collapse.

Mr. Raja is now at the center of what may turn out to be the biggest political corruption scandal in Indian history. He is accused of using his post to sell off valuable mobile telephone spectrum licenses in 2008 at rock-bottom prices. His decisions may have cost the Indian treasury as much as $40 billion, according to a government investigative report released last week.

The widening scandal, coming on the heels of two major political scandals involving senior Congress Party officials, has eroded faith in India’s government. Last week, India’s prime minister, Manmohan Singh, widely regarded as a figure of unimpeachable integrity, was rapped by the Supreme Court for failing to investigate quickly. The scandal also threatens to undermine one of the cornerstones of India’s rapidly growing, technology-driven economy.

The story of how Mr. Raja rose from small-time regional politician to telecommunications minister is emblematic of how politics in India, the world’s largest democracy, really work. Small, regional parties, often formed along family or caste lines, hold outsize sway here, taking command of crucial and potentially lucrative parts of the government to fill their pockets and party coffers.

“When there is a multiparty coalition at the center, you have got to turn a blind eye to the actions of some of the less principled parties,” said Prem Shankar Jha, a political analyst.

Since 1989, when Rajiv Gandhi’s government went down in defeat in the wake of a corruption scandal involving military contracts, no party has won an outright majority in Parliament. As a result, forming a government has required complicated and often messy coalitions with smaller regional parties. These parties often have no national agenda and see power in the center as little more than an opportunity to loot.

The Congress Party has had no shortage of corruption scandals of its own. But it currently controls the most crucial government functions — internal security, foreign policy, defense and finance — and has entrusted them to seasoned leaders with unassailable credentials. But the realities of coalition politics, in which crucial allies must be given important posts, have left some large ministries in the hands of smaller parties, which have in turn put questionable politicians in important jobs.

This has led to embarrassing scandals and mismanagement in the past. In 2006, the coal minister, Shibu Soren, a politician from the eastern state of Jharkhand and an important ally of the Congress Party, was forced to resign after he was convicted on murder charges. India’s railways, the country’s largest employer, are in the hands of Mamata Banerjee, a populist leader whose sole aim appears to be defeating the Communist Party of India in West Bengal and putting her party, the Trinamool Congress, in power.

Photo

Andimuthu RajaCredit
Saurabh Das/Associated Press

Mr. Raja’s party, the Tamil Nadu-based Dravida Munnetra Kazhagam, or D.M.K., was once a liberation movement built on Tamil nationalism. But the party has largely jettisoned ideology. An octogenarian, wheelchair-dependent patriarch named M. Karunanidhi and his plentiful and perpetually feuding progeny run it, and it more closely resembles a sprawling family business empire than a political party.

When the Congress Party returned to power in 2004, it won narrow advantage over the center-right Bharatiya Janata Party, whose former ally, the D.M.K., linked up instead with Congress. The D.M.K.’s reward was the telecommunications ministry and several other posts.

Mr. Karunanidhi sent his grandnephew, a local media tycoon named Dyanidhi Maran, to Delhi to become telecommunications minister. But Mr. Maran fell afoul of Mr. Karunanidhi’s eldest son. In an effort to quiet the burgeoning family feud, Mr. Karunanidhi replaced Mr. Maran, a powerful political player in Tamil Nadu, with Mr. Raja, who was much less well known but who had a close relationship with Mr. Karunanidhi’s daughter Kanimozhi, who is also a powerful party figure.

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Mr. Raja had a history of party activism dating to his college days. He had been a minister in a previous government. He was the most important politician in the state from the Dalit, or formerly untouchable, community, and giving him a big job would secure Dalit votes.

“He was loyal and he was not a threat,” said Vaasanthi, an analyst who has written extensively about Tamil Nadu politics and who goes by one name. “That was his qualification for the job.”

Mr. Raja may not have been a threat to Mr. Karunanidhi’s children, who jealously guard control of the party as their birthright. But his handling of the spectrum sale has undermined confidence in what initially appeared to be India’s most stable and competent government in years.

Even Mr. Singh, widely seen as one of the most upstanding politicians in India, has been tarred in the scandal. While no one has suggested he was involved in corruption, India’s Supreme Court criticized him last week for failing to respond to a call for an investigation into Mr. Raja’s handling of the spectrum sale.

Mr. Singh has pledged to punish anyone found guilty in the scandal, but questions linger about why he did not act sooner to remove Mr. Raja, leading some to conclude that the Congress Party will sacrifice almost any principle to hold on to its governing coalition.

Mr. Raja resigned under pressure on Nov. 14, but he has denied any wrongdoing. India’s Central Bureau of Investigation is carrying out a criminal inquiry.

The Congress Party has faced its own corruption scandals in recent weeks. The senior politician who was in charge of the disastrous preparations for the Commonwealth Games last month had to resign from a minor party position amid multiple inquiries into fraud and graft. The chief minister of Maharashtra, the state that includes Mumbai, was also forced to step down after it was discovered that members of his family had improperly received valuable apartments meant for war widows.

Such scandals, analysts say, could undermine efforts by the Congress Party’s chief, Sonia Gandhi, and her son Rahul to win an outright majority in the next election, in 2014.

A version of this article appears in print on November 22, 2010, on Page A4 of the New York edition with the headline: Unlikely Person at the Heart of India’s Widening Graft Scandal. Order Reprints|Today's Paper|Subscribe